EX-10.12






ENVIRONMENTAL INDEMNITY AGREEMENT




This Environmental Indemnity Agreement (this “Agreement”), which is dated as of June
24, 2008, is executed by G&E HEALTHCARE REIT EPLER PARKE BUILDING B, LLC, a Delaware limited
liability company (“Epler B Borrower”), and GRUBB & ELLIS HEALTHCARE REIT, INC., a Maryland
corporation (“Indemnitor”), in favor of WACHOVIA FINANCIAL SERVICES, INC., a North Carolina
corporation, as administrative agent for the “Lenders” pursuant to the Loan Agreement described
below (in such capacity, “Administrative Agent”) and in favor of each party that now or
hereafter is bound under the Loan Agreement as a “Lender” (referred to herein individually as a
"Lender” and collectively as “Lenders”).



RECITALS




A. Lenders have agreed upon certain conditions to make a loan to Epler B Borrower, G&E
Healthcare REIT 5995 Plaza Drive, LLC, a Delaware limited liability company, G&E Healthcare REIT
Nutfield Professional Center, LLC, a Delaware limited liability company, G&E Healthcare REIT
Academy, LLC, a Delaware limited liability company, and G&E Healthcare REIT Medical Portfolio 2,
LLC, a Delaware limited liability company (collectively, “Borrower”), in the maximum
principal amount of up to Fifty Million Three Hundred Twenty-One Thousand Five Hundred and No/100
Dollars ($50,321,500.00) (“Loan”), which Loan is evidenced by one or more promissory notes,
each now or hereafter executed by Borrower to one or more Lenders, in the aggregate principal
amount of $50,321,500.00 (“Notes”), and which Loan and Notes are secured by, among other
documents, that certain Mortgage, Assignment, Security Agreement and Fixture Filing
(“Mortgage”) of even date herewith, executed by Epler B Borrower for the benefit of
Administrative Agent, encumbering certain real and personal property as therein described
(collectively, the “Property”), including the land described in Exhibit A which is
attached hereto and made a part hereof; and



B. Borrower has entered into a Loan Agreement (“Loan Agreement”) with Administrative
Agent and Lenders, relating to the Loan; and



C. Administrative Agent is acting as the agent for all of the Lenders now or hereafter
existing under the Loan Agreement; and



D. Lenders have refused to make the Loan to Borrower unless this Agreement is executed by
Epler B Borrower and Indemnitor and is delivered to Administrative Agent (on behalf of Lenders).



NOW, THEREFORE, in consideration of Administrative Agent’s and Lenders’ entering into the Loan
Agreement and of other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by Epler B Borrower and Indemnitor, Epler B Borrower and Indemnitor hereby
agree that the foregoing recitals are true and correct and are by this reference hereby made a part
hereof as if fully set forth below, and further covenant and agree with Administrative Agent and
Lenders, and their respective successors and assigns, as follows:



1. Certain Definitions. As used in this Agreement:



"C.C.P.” means the California Code of Civil Procedure, as amended from time to time.



"Claim” means any controversy or claim between one or more Obligors and Administrative
Agent or any Lender, whether arising in contract or tort or by statute, that arises out of or
relates to this Agreement, including any renewals, extensions or modifications hereof.



"Cut-Off Date” means the earlier of the following two dates: (a) the date on which
the indebtedness and obligations secured by the Mortgage have been paid and performed in full and
the Mortgage has been released; or (b) the date on which the lien of the Mortgage is fully and
finally foreclosed or a conveyance by deed in lieu of such foreclosure is fully and finally
effective and possession of the Property has been given to and accepted by the purchaser or grantee
free of occupancy and claims to occupancy by Obligors and their heirs, devisees, representatives,
successors and assigns; provided, however, that if such payment, performance, release, foreclosure
or conveyance is challenged in proceedings under any Debtor Relief Law or otherwise, the Cut-Off
Date shall be deemed not to have occurred until such challenge is validly released, dismissed with
prejudice or otherwise barred by law from further assertion.



"Debtor Relief Law” means any federal, state or local law, domestic or foreign, as now
or hereafter in effect relating to bankruptcy, insolvency, liquidation, receivership,
reorganization, arrangement, composition, extension or adjustment of debts, or any similar law
affecting the rights of creditors.



"Default” has the meaning ascribed to such term in the Mortgage and includes any
breach of any covenant, representation or warranty and any other default under this Agreement,
subject to any applicable notice and cure period.



"Default Rate” is the rate set forth in the last sentence of Section 2.3(b) of the
Loan Agreement.



"Environmental Assessment” means a report (including all drafts thereof) of an
environmental assessment of the Property of such scope as may be requested by Administrative Agent
or another Indemnified Party, including the taking of soil borings and air and groundwater samples
and other above- and below-ground testing, by a consulting firm acceptable to such Indemnified
Party and made in accordance with the established guidelines of such Indemnified Party.



"Environmental Claim” means any investigative, enforcement, cleanup, removal,
containment, remedial or other private or governmental or regulatory action at any time threatened,
instituted or completed pursuant to any applicable Environmental Requirement, against Epler B
Borrower or any Obligor against or with respect to the Property or any condition, use or activity
on the Property (including any such action against any Indemnified Party), and any claim at any
time threatened or made by any person against any Obligor or against or with respect to the
Property or any condition, use or activity on the Property (including any such claim against any
Indemnified Party), relating to damage, contribution, cost recovery, compensation, loss or injury
resulting from or in any way arising in connection with any Hazardous Material or any Environmental
Requirement.



"Environmental Damages” means all claims, demands, liabilities (including strict
liability), losses, damages (including consequential damages), causes of action, judgments,
penalties, fines, reasonable costs and expenses (including reasonable fees, costs and expenses of
attorneys, consultants, contractors, experts and laboratories), of any and every kind and
character, contingent or otherwise, matured or unmatured, known or unknown, foreseeable or
unforeseeable, made, incurred, suffered, brought, or imposed at any time and from time to time, and
arising in whole or in part from any of the following matters, regardless of whether caused by an
Obligor or a tenant or subtenant, or a prior owner of the Property or its tenant or subtenant, or
any third party:




(a) The presence of any Hazardous Material on the Property, or any escape, seepage,
leakage, spillage, emission, release, discharge or disposal of any Hazardous Material on or
from the Property, or the migration or release or threatened migration or release of any
Hazardous Material to, from or through the Property, on or before the Cut-Off Date; or




(b) Any act, omission, event or circumstance existing or occurring in connection with
the handling, treatment, containment, removal, storage, decontamination, cleanup, transport
or disposal of any Hazardous Material which is or was present on the Property on or before
the Cut-Off Date; or




(c) The breach of any representation, warranty, covenant or agreement contained in this
Agreement because of any event or condition occurring or existing on or before the Cut-Off
Date; or




(d) Any violation relating to the Property on or before the Cut-Off Date, of any
Environmental Requirement in effect on or before the Cut-Off Date, regardless of whether any
act, omission, event or circumstance giving rise to the violation constituted a violation at
the time of the occurrence or inception of such act, omission, event or circumstance; or




(e) Any Environmental Claim, or the filing or imposition of any environmental lien
against the Property, because of, resulting from, in connection with, or arising out of any
of the matters referred to in the preceding clauses (a) through (d).



Without limiting the generality of the foregoing, “Environmental Damages” includes:
(i) the investigation or remediation of any such Hazardous Material or violation of any such
Environmental Requirement, including the preparation of any feasibility studies or reports and the
performance of any cleanup, remediation, removal, response, abatement, containment, closure,
restoration, monitoring or similar work required by any Environmental Requirement or necessary to
have full use and benefit of the Property as contemplated by the Loan Documents (including any of
the same in connection with any foreclosure action or transfer in lieu thereof); (ii) injury or
damage to any person, property or natural resource occurring on or off the Property, including the
cost of demolition and rebuilding of any improvements on real property; (iii) all liability to pay
or indemnify any person or governmental authority for costs expended in connection with any of the
matters included within this definition of Environmental Damages; (iv) the investigation and
defense of any claim, whether or not such claim is ultimately defeated; and (v) the settlement of
any claim or judgment.



"Environmental Law” means any federal, state or local law, statute, ordinance, code,
rule, regulation, license, authorization, decision, order, injunction, decree, or rule of common
law, and any judicial interpretation of any of the foregoing, which pertains to health or safety
(as they relate to natural resources or the environment), any Hazardous Material, or the
environment (including ground or air or water or noise pollution or contamination, and underground
or aboveground tanks) and shall include the Solid Waste Disposal Act, 42 U.S.C. § 6901 et seq.; the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601
et seq. (“CERCLA”), as amended by the Superfund Amendments and Reauthorization Act of 1986
(“SARA”); the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; the Federal
Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.;
the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Safe Drinking Water Act, 42 U.S.C.
§ 300f et seq.; California Health and Safety Code § 25100 et seq.; and any other state or federal
environmental statutes, and all rules, regulations, orders and decrees now or hereafter promulgated
under any of the foregoing, as any of the foregoing now exist or may be changed or amended or come
into effect in the future.



"Environmental Requirement” means any Environmental Law, agreement or restriction, as
the same now exists or may be changed or amended or come into effect in the future, which pertains
to health or safety (as they relate to natural resources or the environment), any Hazardous
Material, or the environment, including ground, air, water or noise pollution or contamination, and
underground or aboveground tanks.



"Hazardous Material” means any substance, whether solid, liquid or gaseous: (a) which
is listed, defined or regulated as a “hazardous substance”, “hazardous waste” or “solid waste”, or
otherwise classified as hazardous or toxic, in or pursuant to any Environmental Requirement; or
(b) which is or which contains asbestos, radon, any polychlorinated biphenyl, urea formaldehyde
foam insulation, explosive or radioactive material, or motor fuel or other petroleum hydrocarbons;
or (c) which causes or poses a threat to cause a contamination or nuisance on the Property or any
adjacent property or a hazard to the environment or to the health or safety of persons on the
Property.



"Indemnified Party” means each of the following persons and entities:
(a) Administrative Agent; (b) Lenders or any subsequent holders of the Notes; (c) Trustee; (d) any
persons or entities owned or controlled by, owning or controlling, or under common control or
affiliated with, Administrative Agent, Lenders, any subsequent holders of the Notes, and/or
Trustee; (e) any participants and co-lenders in the Loan; (f) the directors, officers, partners,
employees, attorneys and agents of each of the foregoing persons and entities; and (g) the heirs,
personal representatives, successors and assigns of each of the foregoing persons and entities.



"Loan Documents” has the meaning ascribed to such term in the Mortgage.



"Obligor” means any individual Epler B Borrower or Indemnitor and “Obligors”
means some or all of the persons and entities comprising Epler B Borrower and/or Indemnitor,
collectively.



"On” or “on”, when used with respect to the Property or any property adjacent
to the Property, means “on, in, under, above or about.”



"Trustee” means the Trustee under the Mortgage.



2. Representations and Warranties. Each Obligor hereby represents and warrants to,
and covenants with, Administrative Agent and Lenders, that, except as disclosed in that certain
Phase 1 Environmental Site Assessment Report provided to Administrative Agent in connection with
the closing of the Loan, as of the date of recordation of the Mortgage:



(a) During the period of Epler B Borrower’s ownership of the Property, the Property has not
been used for industrial or manufacturing purposes, for landfill, dumping or other waste disposal
activities or operations, for generation, storage, use, sale, treatment, processing, recycling or
disposal of any Hazardous Material, for underground or aboveground storage tanks, or for any other
use that could give rise to the release of any Hazardous Material on the Property, except for
minimal quantities of substances on the Property which technically could be considered Hazardous
Material (provided that such substances are of a type and are held only in a quantity normally used
in connection with the construction, occupancy or operation of comparable buildings (such as
cleaning fluids and supplies normally used in the day-to-day operation of business offices), and
such substances are being held, stored and used in compliance with all applicable Environmental
Requirements); to the best of Obligors’ knowledge, no such use of the Property occurred at any time
prior to the period of Epler B Borrower’s ownership of the Property; and to the best of Obligors’
knowledge, no such use on any adjacent property occurred at any time prior to the date hereof;



(b) Except for minimal quantities of substances on the Property which technically could be
considered Hazardous Material (provided that such substances are of a type and are held only in a
quantity normally used in connection with the occupancy or operation of comparable buildings (such
as cleaning fluids and supplies normally used in the day-to-day operation of business offices), and
such substances are being held, stored and used in compliance with all applicable Environmental
Requirements), to the best of Obligors’ knowledge, there is no Hazardous Material, storage tank (or
similar vessel) whether underground or otherwise, sump or well currently on the Property;



(c) Obligors have received no written notice and have no knowledge of any Environmental Claim
or any completed, pending or proposed or threatened investigation or inquiry concerning the
presence or release of any Hazardous Material on the Property or any adjacent property or
concerning whether any condition, use or activity on the Property or any adjacent property is in
violation of any existing Environmental Requirement;



(d) To the best of Obligors’ knowledge, the present conditions, uses and activities of and on
the Property do not violate any existing Environmental Requirement and the use of the Property
which Epler B Borrower (and each tenant and subtenant, if any) makes and intends to make of the
Property complies and will comply with all applicable Environmental Requirements;



(e) The Property does not appear on and to the best of Obligors’ knowledge has never been on
the National Priorities List, any federal or state “superfund” or “superlien” list,
or any other list or database of properties maintained by any local, state or federal agency or
department showing properties which are known to contain or which are suspected of containing a
Hazardous Material;



(f) To the best of Obligors’ knowledge, no action has been taken pursuant to the provisions of
California Health and Safety Code §§ 25220-25241 to designate the Property as a hazardous waste
property or border zone property or otherwise to restrict the land use of the Property (including
through a moratorium on new land uses), nor does any Obligor know of any basis for such designation
or other restriction;



(g) Obligors have never applied for and been denied environmental impairment liability
insurance coverage relating to the Property; and



(h) No Obligor, and to Obligors’ knowledge no tenant or subtenant, has obtained or is required
to obtain any permit or authorization to construct, occupy, operate, use or conduct any activity on
any of the Property by reason of any Environmental Requirement.



3. Violations. Prior to the Cut-Off Date, Obligors will not cause, commit, permit or
allow to continue any violation of any Environmental Requirement (a) by any person or entity,
including any Obligor, or (b) by or with respect to the Property or any use of or activity on the
Property. In addition, Obligors will not cause, permit or allow to continue the attachment of any
environmental lien to the Property. Obligors will not place, install, dispose of or release, or
cause, permit, or allow the placing, installation, disposal, spilling, leaking, dumping or release
of, any Hazardous Material or storage tank (or similar vessel) on the Property and will keep the
Property free of Hazardous Material. Notwithstanding the foregoing provisions of this
Section 3, Obligors shall not be in Default under this Section 3 should Obligors
store minimal quantities of substances on the Property which technically could be considered
Hazardous Material; provided that such substances are of a type and are held only in a quantity
normally used in connection with the occupancy or operation of comparable buildings (such as
cleaning fluids and supplies normally used in the day-to-day operation of business offices), and
such substances are being held, stored and used in compliance with all applicable Environmental
Requirements. The indemnity in Section 6 of this Agreement shall always apply to such
substances, and it shall be and continue to be the responsibility of Obligors to take all remedial
actions required under and in accordance with Section 5 of this Agreement in the event of
any unlawful release of any such substance.



4. Notice to Lender. Obligors shall promptly deliver to Administrative Agent a copy
of each report pertaining to the Property or to any Obligor prepared by or on behalf of any Obligor
pursuant to any Environmental Requirement. Obligors shall promptly advise Administrative Agent in
writing of any Environmental Claim or of the discovery of any Hazardous Material on the Property as
soon as any Obligor first obtains knowledge thereof, including a full description of the nature and
extent of the Environmental Claim and/or Hazardous Material and all relevant circumstances.



5. Remedial Actions.



(a) Except as permitted under Section 3 above, if any Hazardous Material is discovered
on the Property at any time, prior to the Cut-Off Date, and regardless of the cause, Obligors shall
promptly at Obligors’ sole risk and expense and solely under the names of Obligors or any of them:
(i) remove, treat, and dispose of the Hazardous Material in compliance with all applicable
Environmental Requirements, or if such removal is prohibited by any Environmental Requirement, take
whatever action as is required by any Environmental Requirement; and (ii) take such other action as
is necessary to have the full use and benefit of the Property as contemplated by the Loan
Documents. Obligors at their sole expense shall provide Administrative Agent with satisfactory
evidence of the actions taken as required in this clause (a). Obligors shall provide to
Administrative Agent within thirty (30) days of Administrative Agent’s request a bond, letter of
credit or other financial assurance evidencing to Administrative Agent’s satisfaction that all
necessary funds are readily available to pay the costs and expenses of the actions required by this
clause (a) and to discharge any assessments or liens established against the Property as a result
of the presence of the Hazardous Material on the Property.



(b) All remedial actions shall be conducted (i) in a diligent and timely fashion by licensed
contractors acting under the supervision of a consultant or consulting environmental engineer, and
(ii) in accordance with all Environmental Requirements and all other applicable governmental
requirements. The selection of the contractors and consultant or consulting environmental engineer
for the remedial actions, the contracts entered into with such parties, any disclosures to or
agreements with any public or private agencies or parties relating to the remedial actions and any
written plan for the remedial actions (and any changes thereto) shall each, at the option of
Administrative Agent, be subject to the prior written approval of Administrative Agent, which
approval shall not be unreasonably withheld, conditioned or delayed. Within fifteen (15) days
after completion of such remedial actions, Obligors shall obtain and deliver to Administrative
Agent an Environmental Assessment of the Property made after such completion which shall confirm to
Administrative Agent’s satisfaction that all required remedial action as stated above has been
taken and successfully completed and that there is no evidence or suspicion of any contamination or
risk of contamination on the Property or any adjacent property or of violation of any Environmental
Requirement with respect to any such Hazardous Material.



(c) After the occurrence and during the continuance of a Default, Administrative Agent may,
but shall never be obligated to, remove or cause the removal of any Hazardous Material from the
Property (or if removal is prohibited by any Environmental Requirement, take or cause the taking of
such other action as is required by any Environmental Requirement) if Obligors fail to promptly
commence such remedial actions following discovery and thereafter diligently prosecute the same to
the satisfaction of Administrative Agent (without limitation of Administrative Agent’s rights to
declare a Default under any of the Loan Documents and to exercise all rights and remedies available
by reason thereof). After the occurrence and during the continuance of a Default, Administrative
Agent and its designees are hereby granted access to the Property at any time or times, upon
reasonable notice (which may be written or oral), and a license which is coupled with an interest
and irrevocable, to remove or cause such removal or to take or cause the taking of any such other
action.



6. Indemnity. Obligors hereby agree to protect, indemnify, defend and hold
Indemnified Parties and each of them harmless from and against, and, if and to the extent paid, to
reimburse them on demand for, any and all Environmental Damages. Without limitation, the foregoing
indemnity shall apply to each Indemnified Party with respect to Environmental Damages which in
whole or in part are caused by or arise out of the negligence of such (and/or any other)
Indemnified Party. However, such indemnity shall not apply to (a) a particular Indemnified Party
to the extent that the subject of the indemnification is caused by or arises out of the gross
negligence or willful misconduct of that particular Indemnified Party, or (b) Environmental Damages
created or arising solely from events or conditions first existing after a foreclosure sale under
the Mortgage (or a deed in lieu thereof), but only if a party other than Obligors or an affiliate
of any Obligor acquires title to the Property, provided that any such Environmental Damages do not
directly or indirectly arise from or relate to any release of or exposure to any Hazardous
Materials (including personal injury or damage to property), noncompliance with any Environmental
Laws, or remediation existing prior to the event described above. In any dispute between Obligors
and Administrative Agent and/or Lenders as to whether Obligors are released from liability pursuant
to the immediately preceding sentence, Obligors shall bear the burden of proof with respect to
whether they have been released from liability. Upon demand by any Indemnified Party, Obligors
shall diligently defend any Environmental Claim which affects the Property or which is made or
commenced against such Indemnified Party, whether alone or together with Obligors or any other
person, all at Obligors’ own cost and expense and by counsel to be approved by such Indemnified
Party in the exercise of its reasonable judgment. In the alternative, at any time any Indemnified
Party may elect to conduct its own defense through counsel selected by such Indemnified Party and
at the cost and expense of Obligors. Obligors and Indemnified Parties intend that to the extent
that Environmental Damages are not recoverable under C.C.P. § 736(a), such Environmental Damages
shall be recoverable under the law of the State of California other than C.C.P. § 736, as provided
in C.C.P. § 736(d).



7. Binding Obligations; Survival. The representations, warranties, covenants and
agreements in this Agreement shall be binding upon Obligors and their successors, assigns and legal
representatives and shall inure to the benefit of Indemnified Parties and each of them; provided,
however, that Obligors may not assign this Agreement, or assign or delegate any of their rights or
obligations under this Agreement, without the prior written consent of Administrative Agent in each
instance. The representations, warranties, covenants and agreements in this Agreement shall not
terminate on the Cut-Off Date or upon the release, foreclosure or other termination of the
Mortgage, but will survive the Cut-Off Date, the payment in full of the indebtedness secured by the
Mortgage, foreclosure of the Mortgage or conveyance in lieu of foreclosure, the release or
termination of the Mortgage and any and all of the other Loan Documents and Swap Contracts, any
investigation by or on behalf of any Indemnified Party, any proceeding under any Debtor Relief Law,
and any other event whatsoever. Without limiting the generality of the foregoing, the obligations
of Obligors to indemnify Indemnified Parties under Section 6 after the Cut-Off Date shall
be presumed, unless shown by a preponderance of evidence to the contrary.



8. Environmental Assessments. If any Indemnified Party shall ever have reason to
believe that any Hazardous Material affects the Property, or if any Environmental Claim is made or
threatened, or if a Default shall have occurred, or upon the occurrence of the Cut-Off Date if
requested by any Indemnified Party, Obligors shall at their expense provide to such Indemnified
Party from time to time, in each case within thirty (30) days after request by such Indemnified
Party, an Environmental Assessment made after the date of such request. Obligors will cooperate
with each consulting firm making any such Environmental Assessment and will supply to the
consulting firm, from time to time and promptly on request, all information available to Obligors
to facilitate the completion of the Environmental Assessment. If Obligors fail to furnish any
Indemnified Party within ten (10) days after such Indemnified Party’s request with a copy of an
agreement with an acceptable environmental consulting firm to provide such Environmental
Assessment, or if Obligors fail to furnish to any Indemnified Party such Environmental Assessment
within thirty (30) days after request by such Indemnified Party, the Indemnified Party may cause
any such Environmental Assessment to be made at Obligors’ expense and risk. Indemnified Parties
and their designees are hereby granted access to the Property at any time or times, upon reasonable
notice (which may be written or oral), and a license which is coupled with an interest and
irrevocable, to make or cause to be made such Environmental Assessments. Without limiting the
generality of the foregoing, Obligors agree that Indemnified Parties will have all rights, powers
and authority to enter and inspect the Property as is granted to the secured lender under
California Civil Code § 2929.5, and that any Indemnified Party will have the right to appoint a
receiver to enter and inspect the Property to the extent such authority is provided under
applicable law, including the authority given to the secured lender under C.C.P. § 564(c). All
reasonable costs and expenses incurred by any Indemnified Party in connection with any
Environmental Assessment conducted in accordance with this Section 8 shall be paid by
Obligors. Indemnified Parties shall be under no duty to make any Environmental Assessment of the
Property, and in no event shall any such Environmental Assessment by any Indemnified Party be or
give rise to a representation that any Hazardous Material is or is not present on the Property, or
that there has been or shall be compliance with any Environmental Requirement, nor shall Obligors
or any other person be entitled to rely on any Environmental Assessment made by or at the request
of any Indemnified Party. Indemnified Parties owe no duty of care to protect Obligors or any other
person against, or to inform them of, any Hazardous Material or other adverse condition affecting
the Property.



9. Information. The results of all investigations conducted and/or Environmental
Assessments prepared by or for any Indemnified Party shall be and at all times remain the property
of the Indemnified Party and under no circumstances shall any Indemnified Party have any obligation
whatsoever to disclose or otherwise make available to Obligors or any other party such results or
any other information obtained by any Indemnified Party in connection with such investigations and
reports. Notwithstanding the foregoing, Indemnified Parties hereby reserve the right, and Obligors
hereby expressly authorize any Indemnified Party, to make available to any party (including any
governmental agency or authority and any prospective bidder at any foreclosure sale of the
Property) any and all Environmental Assessments that any Indemnified Party may have with respect to
the Property. Obligors consent to Indemnified Parties notifying any party (either as part of a
notice of sale or otherwise) of the availability of any or all of the Environmental Assessments and
the information contained therein. Obligors acknowledge that Indemnified Parties cannot control or
otherwise assure the truthfulness or accuracy of the Environmental Assessments, and further
acknowledge that the release of the Environmental Assessments, or any information contained
therein, to prospective bidders at any foreclosure sale of the Property may have a material and
adverse effect upon the amount that a party may bid at such sale. Obligors agree that Indemnified
Parties shall have no liability whatsoever as a result of delivering any or all of the
Environmental Assessments or any information contained therein to any third party, and Obligors
hereby release and forever discharge Indemnified Parties from any and all claims, damages, or
causes of action, arising out of, connected with or incidental to the Environmental Assessments or
the delivery thereof.



10. Cross-Default with Loan Documents and Swap Contracts. Any Default under this
Agreement shall constitute a Default under the Loan Documents and Swap Contracts. In addition, any
Default under any of the Loan Documents or Swap Contracts shall constitute a Default hereunder.



11. Payable on Demand; Remedies. Any amounts to be paid under this Agreement by
Obligors (or any of them) from time to time shall be payable by Obligors within ten (10) business
days after demand by Administrative Agent or any other Indemnified Party. In addition to any other
rights or remedies Administrative Agent or Lenders may have under this Agreement, at law or in
equity, upon the occurrence of a Default under this Agreement, Administrative Agent and Lenders may
(a) pursue any remedies available to it under C.C.P. § 726.5 and C.C.P. § 736, and/or (b) subject
to the terms and conditions of this Agreement, do or cause to be done whatever is necessary to
cause the Property to comply with all Environmental Requirements, and the cost thereof shall become
immediately due and payable upon demand by Administrative Agent, and if not paid when due shall
accrue interest at the Default Rate until paid. Without limiting any other rights or remedies of
Administrative Agent or Lenders, Obligors acknowledge and agree that the provisions of this
Agreement are “environmental provisions,” as that term is defined in C.C.P. § 736(f)(2), made by
Obligors relating to the real property security, and that Obligors’ failure to comply with the
terms of this Agreement shall be a breach of contract such that Administrative Agent and Lenders
shall have the remedies provided under C.C.P. § 736 for the recovery of damages and for the
enforcement thereof. Pursuant to C.C.P. § 736, Administrative Agent’s and/or Lenders’ action for
the recovery of damages or enforcement of this Agreement shall not constitute an action within the
meaning of C.C.P. § 726(a) or constitute a money judgment for a deficiency or a deficiency judgment
within the meaning of C.C.P. § 580a, § 580b, or § 726.



12. Unsecured Agreement; Not a Loan Document; Cumulative Rights. This Agreement is
not secured by the Mortgage or any other Loan Document or any collateral whatsoever. This
Agreement is not one of the Loan Documents. Obligors, Administrative Agent and Lenders intend for
this Agreement to serve as Administrative Agent’s and Lenders’ written demand and Obligors’
response concerning the environmental condition of the Property as required by C.C.P. § 726.5. The
liability of Obligors or any other person under this Agreement shall not be limited or impaired in
any way by any provision in the Loan Documents or Swap Contracts or applicable law limiting
Obligors’ or such other person’s liability or Administrative Agent and Lenders’ recourse or rights
to a deficiency judgment, or by any change, extension, release, inaccuracy, breach or failure to
perform by any party under the Loan Documents or Swap Contracts, Obligors’ (and, if applicable,
such other person’s) liability hereunder being direct and primary and not as a guarantor or surety.
Nothing in this Agreement or in any Loan Document or Swap Contract shall limit or impair any
rights or remedies of Administrative Agent, Lenders, Trustee and/or any other Indemnified Party
against any Obligor or any other person under any Environmental Requirement or otherwise at law or
in equity, including any rights of contribution or indemnification.



13. Consideration. Obligors acknowledge that Lenders have relied and will rely on the
representations, warranties, covenants and agreements herein in closing and funding the Loan and
that the execution and delivery of this Agreement is an essential condition but for which Lenders
would not close or fund the Loan. Obligors further acknowledge that Administrative Agent has
relied and will rely on the representations, warranties, covenants and agreements herein in acting
as administrative agent for the Loan and that the execution and delivery of this Agreement is an
essential condition but for which Administrative Agent would not act as administrative agent for
the Loan.



14. No Waiver. No delay or omission by any Indemnified Party to exercise any right
under this Agreement shall impair any such right nor shall it be construed to be a waiver thereof.
No waiver of any single breach or default under this Agreement shall be deemed a waiver of any
other breach or default. Any waiver, consent or approval under this Agreement must be in writing
to be effective.



15. Notices. All notices, requests, consents, demands and other communications
required or which any party desires to give hereunder shall be in writing (including, without
limitation, telecopy, telegraphic, telex, or cable communication) and shall be deemed sufficiently
given or furnished if delivered by personal delivery, by courier, or by registered or certified
United States mail, postage prepaid, addressed to the party to whom directed at the addresses
specified at the end of this Agreement (unless changed by similar notice in writing given by the
particular party whose address is to be changed) or by telegram, telex, or facsimile. Any such
notice or communication shall be deemed to have been given either at the time of personal delivery
or, in the case of courier or mail, as of the date of first attempted delivery at the address and
in the manner provided herein, or, in the case of telegram, telex or facsimile, upon receipt;
provided, that service of a notice required by any applicable statute shall be considered complete
when the requirements of that statute are met. Notwithstanding the foregoing, no notice of change
of address shall be effective except upon actual receipt. This Section 15 shall not be
construed in any way to affect or impair any waiver of notice or demand provided in any Loan
Document or to require giving of notice or demand to or upon any person in any situation or for any
reason.



16. Invalid Provisions. A determination that any provision of this Agreement is
unenforceable or invalid shall not affect the enforceability or validity of any other provision and
a determination that the application of any provision of this Agreement to any person or
circumstance is illegal or unenforceable shall not affect the enforceability or validity of such
provision as it may apply to other persons or circumstances.



17. Construction. Whenever in this Agreement the singular number is used, the same
shall include plural where appropriate, and vice versa; and words of any gender in this Agreement
shall include each other gender where appropriate. The headings in this Agreement are for
convenience only and shall be disregarded in the interpretation hereof. Reference to
"person” or “entity” means firms, associations, partnerships, joint ventures,
trusts, limited liability companies, corporations and other legal entities, including public or
governmental bodies, agencies or instrumentalities, as well as natural persons. The words
"include” and “including” shall be interpreted as if followed by the words
"without limitation.”



18. Joint and Several Liability and Waivers by Obligors.



(a) Each Obligor agrees that it is jointly and severally liable to Indemnified Parties for the
payment of all obligations arising under this Agreement, and that such liability is independent of
the obligations of the other Obligors. Any Indemnified Party may bring an action against any
Obligor, whether or not any action is brought against the other Obligors.



(b) Each Obligor agrees that any release which may be given by any Indemnified Party to the
other Obligors will not release such Obligor from its obligations under this Agreement.



(c) Each Obligor waives any right to assert against any Indemnified Party any defense, setoff,
counterclaim, or claims which such Obligor may have against the other Obligors or any other party
liable to Indemnified Parties or any of them for the obligations of Obligors under this Agreement.



(d) Each Obligor agrees that it is solely responsible for keeping itself informed as to the
financial condition of the other Obligors and of all circumstances which bear upon the risk of
nonpayment. Each Obligor waives any right it may have to require Indemnified Parties to disclose
to such Obligor any information which Indemnified Parties or any of them may now or hereafter
acquire concerning the financial condition of the other Obligors.



(e) Each Obligor waives all rights to notices of acceptance of this Agreement and further
waives all rights to notices of default or nonperformance by any other Obligor under this
Agreement.



(f) Each Obligor waives any right of subrogation, reimbursement, indemnification and
contribution (contractual, statutory or otherwise), including any claim or right of subrogation
under any Debtor Relief Law, which such Obligor may now or hereafter have against any other Obligor
or any other person with respect to the obligations incurred under this Agreement. Each Obligor
waives any right to enforce any remedy that any Indemnified Party now has or may hereafter have
against any other Obligor.



19. Indemnitor Waivers. Indemnitor waives:



(a) All statutes of limitations as a defense to any action or proceeding brought against
Indemnitor by any Indemnified Party, to the fullest extent permitted by law;



(b) Any right it may have to require Indemnified Party to proceed against Epler B Borrower,
proceed against or exhaust any security held from Epler B Borrower, or pursue any other remedy in
any Indemnified Party’s power to pursue;



(c) Any defense based on any claim that Indemnitor’s obligations exceed or are more burdensome
than those of Epler B Borrower;



(d) Any defense based on: (i) any legal disability of Epler B Borrower, (ii) any release,
discharge, modification, impairment or limitation of the liability of Epler B Borrower to any
Indemnified Party from any cause, whether consented to by any Indemnified Party or arising by
operation of law or from any bankruptcy or other voluntary or involuntary proceeding, in or out of
court, for the adjustment of debtor-creditor relationships (“Insolvency Proceeding”) and
(iii) any rejection or disaffirmance of the Loan, or any part of it, or any security held for it,
in any such Insolvency Proceeding;



(e) Any defense based on any action taken or omitted by any Indemnified Party in any
Insolvency Proceeding involving Epler B Borrower, including any election to have any Indemnified
Party’s claim allowed as being secured, partially secured or unsecured, any extension of credit by
any Indemnified Party to Epler B Borrower in any Insolvency Proceeding, and the taking and holding
by any Indemnified Party of any security for any such extension of credit;



(f) All presentments, demands for performance, notices of nonperformance, protests, notices of
protest, notices of dishonor, notices of acceptance of this Agreement and of the existence,
creation, or incurring of new or additional indebtedness, and demands and notices of every kind;
and



(g) Any defense based on or arising out of any defense that Epler B Borrower may have to the
payment or performance of the Loan or any part of it.



20. Waivers of Subrogation and Other Rights.



(a) Upon the occurrence and during the continuance of a Default by Epler B Borrower,
Administrative Agent and Lenders in their sole discretion, without prior notice to or consent of
Indemnitor, may elect to: (i) foreclose either judicially or nonjudicially against any real or
personal property security it may hold for the Loan, (ii) accept a transfer of any such security in
lieu of foreclosure, (iii) compromise or adjust the Loan or any part of it or make any other
accommodation with Epler B Borrower or Indemnitor, or (iv) exercise any other remedy against Epler
B Borrower or any security. No such action by Administrative Agent and/or Lenders shall release or
limit the liability of Indemnitor, each of whom shall remain liable under this Agreement after the
action, even if the effect of the action is to deprive Indemnitor of any subrogation rights, rights
of indemnity, or other rights to collect reimbursement from Epler B Borrower for any sums paid to
any Indemnified Party, whether contractual or arising by operation of law or otherwise. Indemnitor
expressly agrees that under no circumstances shall it be deemed to have any right, title, interest
or claim in or to any real or personal property to be held by any Indemnified Party or any third
party after any foreclosure or transfer in lieu of foreclosure of any security for the Loan.



(b) Regardless of whether Indemnitor may have made any payments to any Indemnified Party,
Indemnitor forever waives: (i) all rights of subrogation, all rights of indemnity, and any other
rights to collect reimbursement from Epler B Borrower for any sums paid to any Indemnified Party,
whether contractual or arising by operation of law (including the United States Bankruptcy Code or
any successor or similar statute) or otherwise, (ii) all rights to enforce any remedy that any
Indemnified Party may have against Epler B Borrower, and (iii) all rights to participate in any
security now or later to be held by any Indemnified Party for the Loan.



(c) Indemnitor understands and acknowledges that if Administrative Agent or any Lender
forecloses judicially or nonjudicially against any real property security for the Loan, that
foreclosure could impair or destroy any ability that Indemnitor may have to seek reimbursement,
contribution or indemnification from Epler B Borrower or others based on any right Indemnitor may
have of subrogation, reimbursement, contribution or indemnification for any amounts paid by
Indemnitor under this Indemnity. Indemnitor further understands and acknowledges that in the
absence of the provisions of this Indemnity, such potential impairment or destruction of
Indemnitor’s rights, if any, may entitle Indemnitor to assert a defense to this Indemnity based on
Section 580d of the California Code of Civil Procedure as interpreted in Union Bank v.
Gradsky, 265 Cal.App.2d 40 (1968). By executing this Agreement, Indemnitor freely, irrevocably
and unconditionally: (i) waives and relinquishes that defense and agrees that Indemnitor will be
fully liable under this Agreement even though Administrative Agent or a Lender may foreclose
judicially or nonjudicially against any real property security for the Loan; (ii) agrees that
Indemnitor will not assert that defense in any action or proceeding which any Indemnified Party may
commence to enforce this Agreement; (iii) acknowledges and agrees that the rights and defenses
waived by Indemnitor under this Agreement include any right or defense that Indemnitor may have or
be entitled to assert based upon or arising out of any one or more of Sections 580a, 580b, 580d
or 726 of the California Code of Civil Procedure or Section 2848 of the California Civil Code;
(iv) acknowledges and agrees that Lender is relying on this waiver in making the Loan, and that
this waiver is a material part of the consideration which Lender is receiving for making the Loan;
and (v) acknowledges and agrees that Administrative Agent is relying on this waiver in agreeing to
act as administrative agent for the Loan, and that this waiver is a material part of the
consideration which Administrative Agent is receiving for acting as Administrative Agent for the
Loan.



(d) Indemnitor waives Indemnitor’s rights of subrogation and reimbursement and any other
rights and defenses available to Indemnitor by reason of Sections 2787 to 2855, inclusive, of the
Civil Code including, without limitation, (i) any defenses Indemnitor may have to the indemnity
obligation by reason of an election of remedies by Administrative Agent or any Lender and (ii) any
rights or defenses Indemnitor may have by reason of protection afforded to Epler B Borrower with
respect to the obligation so guaranteed pursuant to the antideficiency or other laws of California
or Indiana limiting or discharging Epler B Borrower’s indebtedness, including without limitation,
Sections 580a, 580b, 580d, or 726 of the Code of Civil Procedure.



(e) Indemnitor waives all rights and defenses arising out of an election of remedies by any
Indemnified Party, even though that election of remedies, such as a nonjudicial foreclosure with
respect to security for a guaranteed obligation, has destroyed Indemnitor’s rights of subrogation
and reimbursement against Epler B Borrower by the operation of Section 580d of the Code of Civil
Procedure or otherwise.



(f) No provision or waiver in this Indemnity shall be construed as limiting the generality of
any other waiver contained in this Indemnity.



21. Indemnitor waives all rights and defenses that Indemnitor may have because Borrower’s debt
is secured by real property. This means, among other things:



(a) Administrative Agent and/or Lenders may collect from Indemnitor without first foreclosing
on any real or personal property collateral pledged by Borrower.



(b) If Administrative Agent and/or Lenders forecloses on any real property collateral pledged
by Borrower:




i. The amount of the debt may be reduced only by the price for which that
collateral is sold at the foreclosure sale, even if the collateral is worth more
than the sale price.




ii. Administrative Agent may collect from Indemnitor even if Administrative
Agent and/or Lender, by foreclosing on the real property collateral, has destroyed
any right Indemnitor may have to collect from Borrower.



This is an unconditional and irrevocable waiver of any rights and defenses Indemnitor may have
because Borrower’s debt is secured by real property.



22. Applicable Law. The laws of the State of California and applicable United States
federal law shall govern the rights and duties of the parties hereto and the validity, enforcement
and interpretation hereof.



23. Lender Assigns; Disclosure of Information. Administrative Agent and any Lender
may, at any time, sell, transfer, or assign its interest in the Loan and any and all servicing
rights with respect thereto, or grant participations therein or issue mortgage pass-through
certificates or other securities evidencing a beneficial interest in a rated or unrated public
offering or private placement. In the event of any such sale, transfer or assignment of the Loan
or any part thereof, the rights and benefits under this Agreement may be transferred therewith to
the extent applicable to the Loan or part thereof being sold, transferred or assigned. Obligors
waive notice of any sale, transfer or assignment of the Loan or any part thereof, and agree that
failure to give notice of any such sale, transfer or assignment will not affect the liabilities of
Obligors hereunder. Administrative Agent and Lenders are hereby authorized to disseminate any
information they now has or hereafter obtain pertaining to the Property or this Agreement,
including credit and/or other information on Obligors and/or any party liable, directly or
indirectly, for any part of the obligations under this Agreement, to any actual or prospective
assignee or participant with respect to the Loan, to any of Administrative Agent’s or Lenders’
affiliates to any regulatory body having jurisdiction over Administrative Agent or any Lender, and
to any other parties as necessary or appropriate in Administrative Agent or any Lender’s reasonable
judgment.



24. Execution; Modification. This Agreement may be executed in any number of
identical counterparts, each of which shall be deemed an original for all purposes and all of which
constitute, collectively, one agreement. This Agreement may be amended only by an instrument in
writing intended for that purpose executed jointly by an authorized representative of each party
hereto.



25. WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, OBLIGORS AND
LENDER HEREBY WAIVE TRIAL BY JURY IN RESPECT OF ANY “CLAIM” AS DEFINED IN SECTION 1. THIS
WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY OBLIGORS AND LENDER, AND OBLIGORS AND LENDER
HEREBY REPRESENT THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY PERSON OR ENTITY
TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT. OBLIGORS AND
LENDER ARE EACH HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION 25 IN ANY PROCEEDING AS
CONCLUSIVE EVIDENCE OF THIS WAIVER OF JURY TRIAL. EACH OBLIGOR FURTHER REPRESENTS AND WARRANTS
THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY
INDEPENDENT LEGAL COUNSEL, OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL
COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER
WITH COUNSEL.



26. Indiana Responsible Property Transfer. Each Obligor hereby represents that to its
knowledge the Property is not “property” as defined in Indiana Code Section 13-11-2-174, and is
not, and has not been used as, a landfill or dump, and contains no underground storage tanks or
toxic or hazardous waste or materials, and that no disclosure statement under Indiana Code Section
13-25-3-1 et seq. (Indiana Responsible Property Transfer Law), is required for this transaction.



[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]




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THIS AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



EXECUTED and DELIVERED as of the date first written above.



	 	 	 	 	 
	Epler B BORROWER:
	 	 	 	 
	The address of Borrower is:
	 	 	 	 
	G&E Healthcare REIT Epler Parke
Building B, LLC
c/o Grubb & Ellis Realty
	 	G&E HEALTHCARE REIT EPLER PARKE
	Investors, LLC
	 	BUILDING B, LLC, a Delaware limited liability
	1551 N. Tustin Avenue, Suite 300
	 	company
	Santa Ana, California 92705
	 	By: /s/ Shannon K S Johnson
	Attn: Shannon Johnson and Dan
	 	Name: Shannon K S Johnson
	Prosky
	 	Title: Authorized Signatory
	INDEMNITOR:
	 	 	 	 
	The address of Indemnitor is:
	 	 	 	 
	Grubb & Ellis Healthcare REIT, Inc.
c/o Grubb & Ellis Realty
Investors, LLC
	 	GRUBB & ELLIS HEALTHCARE REIT, INC., a
	1551 N. Tustin Avenue, Suite 300
	 	Maryland corporation
	Santa Ana, California 92705
	 	By: /s/ Shannon K S Johnson
	Attn: Shannon Johnson and Dan
	 	Name: Shannon K S Johnson
	Prosky
	 	Title: Chief Financial Officer
	The address for providing notices
to Administrative Agent and
Lenders is:
	 	 	 	 
	Wachovia Financial Services, Inc.
Real Estate Financial Services
General Banking Group
Mail Code: CA 6233
15750 Alton Parkway
Irvine, California 92618
Attn: Anne McNeil
	 	 	 	 







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